Bombay HC rejects BMC capital value rules as basis for property tax


The Bombay High Court on Wednesday overturned certain rules issued by the Brihanmumbai Municipal Corporation (BMC) for assessing the capital value of a property, on the basis of which property tax could be levied.

The High Court said all appraisals and invoices issued under those rules were canceled.

A division bench of Justices Abhay Oka and Riyaz Chagla, however, upheld the constitutional validity of the 2009 amendment to the Maharashtra Municipal Corporations Act which changed the collection of property tax in Mumbai from the assessed value. on standard rent to capital value.

“Rules 20, 21 and 22 of the 2010 and 2015 capital value rules are canceled because they are ultra vires the Companies Act. All contributions and invoices issued under these rules are canceled and canceled,” said the judiciary in its order. .

The court said the civic body will have to rehear the complaints.

The bench suspended its order until August 31 to allow the BMC to appeal to the Supreme Court.

The judiciary heard a slew of petitions filed by an association of landowners, builders’ associations and charities, including religious organizations, against the BMC and the Maharashtra government, challenging the levy of the property tax. on the basis of capital value.

In 2009, the Maharashtra Municipal Corporation Law was amended and a concept of levying property tax on the capital value system came into effect.

The petitioners challenged the constitutional validity of the amended property tax based on the capital value of the land as opposed to the previous assessed value based on standard rents, as well as the validity of the higher tax on land under construction.

The association of landowners and developers have raised a series of constitutional challenges regarding an amendment to the MMC law and the rules developed in 2010 and 2015 for setting the capital value of land and buildings.

The rules are null and unconstitutional, the developers argued.

The capital value of land as a basis for property taxes had seen a sharp increase, with some homeowners being served with a bill in the tens of crore, the petitioners said.

(This story was not edited by Business Standard staff and is auto-generated from a syndicated feed.)

Dear reader,

Business Standard has always strived to provide up-to-date information and commentary on developments that matter to you and have broader political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering has only strengthened our resolve and commitment to these ideals. Even in these difficult times resulting from Covid-19, we remain committed to keeping you informed and updated with credible news, authoritative views and cutting-edge commentary on relevant current issues.
However, we have a demand.

As we fight the economic impact of the pandemic, we need your support even more so that we can continue to provide you with more quality content. Our subscription model has received an encouraging response from many of you who have subscribed to our online content. More subscriptions to our online content can only help us achieve the goals of providing you with even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practice the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital editor

Source link


Comments are closed.